US industry puts on pressure for sanctions on EU

With the US administration now two months past the deadline for enacting new trade sanctions against the European Union, pressure…

With the US administration now two months past the deadline for enacting new trade sanctions against the European Union, pressure is starting to grow from US industries that want to see tougher measures enacted.

The US had been expected imminently to announce tariffs on a new list of $300 million worth of European exports to the US as a means of forcing the EU to eliminate its discriminatory regimes on beef and banana imports.

The so-called "carousel" approach to sanctions is intended to make a greater number of European companies vulnerable to trade retaliation, increasing political pressure on the EU Commission to settle the disputes.

The US first imposed trade sanctions last year after the EU refused to implement panel decisions from the World Trade Organisation requiring those import barriers to be lifted.

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In a letter, Chiquita, the US banana company, joined three US agricultural coalitions in requesting a meeting this week with Mr John Podesta, the White House chief of staff.

"We believe that continued delays in the implementation of this provision have powerful implications for the seriousness our nation attaches to the enforcement of trade agreements," the groups said.

The White House had not responded to the request as of midday yesterday.

If the letter does not produce results, "then we plan to start making some noise", said one agricultural industry official. It will be difficult to mount much pressure, however, before the US Congress returns from its recess next month.

Congress in May approved the carousel approach to retaliation and told the administration to have the new sanctions list in place no later than June 19th. But the administration missed that and several other subsequent self-imposed deadlines.

The final decision has been tied up at the White House, but the reasons for the delay remain unclear. One explanation may be a US desire to avoid upsetting the Europeans in the midst of an unrelated WTO dispute involving the US taxation regime for exports.

The US last month offered a new approach that may resolve the dispute, but the EU has yet to respond to the proposal.